Are Shoplifters Shutting Down Businesses in San Francisco?

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Back in September I Tweeted a take that I thought was pretty lukewarm but ended up making a lot of people very upset. For the several weeks prior, I’d been getting a Wall Street Journal ad repeatedly posted on my timeline claiming that “CVS, Home Depot, Ulta and Target all have something in common. They’re struggling to keep up with organized crime rings stealing from their stores in bulk and selling the goods online, often on Amazon.” Not only was I sick of seeing the same ad posted over and over again, but I was sick of this increasingly common bit of hysteria being pushed at me: the idea that I should give a shit that individuals are stealing from large corporate box stores. So I Tweeted, “This keeps getting promoted to me & I cannot stress enough that stealing from big box stores is fine. Did you know they have an entire playbook on how to avoid paying local taxes as they destroy independent businesses & abandon buildings?”

And I linked to a post from Cory Doctorow about that story, which I will explain in a minute.

I had originally written “stealing from big box stores is not a big deal” but character limits made me change it to “fine.” I understand that “fine” is more open to interpretation and could mean “good” instead, but I still figured even if it was read that way no one would really be upset about even that slightly hotter take. I was wrong, and one guy said that attitudes like mine are why psychotic Republicans gain office and a marginally famous author I was mutuals with unfollowed me and said my Tweet was “frankly insane.”

I was surprised by these reactions but figured Twitter wasn’t the place to have that discussion. Obviously, YouTube is the place for it. Okay, not really that either, but I did decide to finally talk about it when the San Francisco Walgreens story finally reached its inevitable conclusion, as it did last month.

I’ll get to that, but first let me briefly describe Cory Doctorow’s excellent article about the big box hardware retailer Lowe’s: you probably already know (or you should know) that national retailers like Walmart came to small towns and essentially obliterated them starting more or less in the 1990s. They could afford to sell their products at a cheaper price than local mom and pop stores, sometimes straight up taking a loss on sales because all they had to do was wait for those other stores to go bankrupt before there was no more competition. It’s the same model Amazon has used to then put some of those same big box stores, like Borders, out of business.

But what I didn’t know until I read Doctorow’s piece is how those big box stores screw over small towns even after Amazon has put them out of business, using the “dark store” gambit: a corporation appeals its tax assessment, arguing that their property is overvalued because similar properties are selling for much less. Those “similar properties” are other big box stores that have gone out of business. Those properties are essentially worthless because those stores are built specifically to be, say, a Borders, or a Lowe’s, or a Walmart. And when they are put on the market, they often have clauses that prohibit them from being sold to a competitor. You know, like, the only other company that could make use of an empty Borders might be another bookstore like Barnes and Noble, but Barnes and Noble may be contractually prohibited from buying it. So the property sits there, unused and crumbling and worthless. And next door, there’s Lowe’s arguing that their open, profitable store on “similar” property is also worthless. Cha-ching! Tax rebates.

Doctorow points out that a Lowe’s in Michigan successfully used this tactic to slash its tax assessment from $10 million to $1.5 million, forcing the town it was in to PAY Lowe’s $755,828, which forced the town to “(slash) its library, police, and fire-department budgets.”

Big box retailers aren’t just forcing local retailers to shut their doors, leading to ghost mainstreets in towns across the United States — they’re also nearly bankrupting small towns, stealing individuals’ tax dollars, and taking away taxpayer funded community services. Throw that on top of the fact that companies like Walmart end up paying less and offering fewer benefits compared to the employers they put out of business and yeah, I think it’s not that big of a deal to say that no one should be kept awake at night worrying about people shoplifting from national retailers. I mean, the CEOs certainly aren’t worried about it, so why is the Wall Street Journal so insistent that I worry about it?

Of course, the CEOs want you to *think* they care, which is why here in the Bay Area we’ve been inundated with breathless news stories about gangs of shoplifters terrorizing Walgreens, a nationwide pharmacy. That included one viral video of a shoplifter who grabbed a bunch of stuff, hopped on a bike, and rode away as a security guard filmed. After months of these reports, Walgreens announced that the shoplifters were winning and that the company was forced to shut down seventeen locations in San Francisco, including five this past month.

“San Francisco Board of Supervisor Ahsha Safai of District 11 said he was “devastated” by the loss of the store on Mission Street on Twitter, writing “I am completely devastated by this news – this Walgreens is less than a mile from seven schools and has been a staple for seniors, families and children for decades. This closure will significantly impact this community.””

Well, I guess I was wrong! Shoplifting is NOT a victimless crime and we very much SHOULD care about it.

Just kidding! Turns out, Walgreens was lying. According to a San Francisco Chronicle investigation, one of the stores they closed “due to shoplifting” had only reported seven such incidences in the past year and of all the stores announced most recently, they had an average of two reported thefts per month going back to 2018.

Oh, and that viral video of the guy biking out of the store with his ill-gotten gains while the security guard did “nothing”? He was arrested and charged thanks in part to the security guard who rightfully chose to document the situation instead of risking injury by intervening.

So if shoplifting is actually still fairly rare at these locations, why IS Walgreens closing them? Well! Here are a few unrelated facts that I’d like to read to you for no reason:

1) Walgreens currently has 53 locations in the city of San Francisco. San Francisco encompasses about 47 square miles. That means that on average you are never more than a 15-minute walk from a Walgreens and also in some neighborhoods you can enjoy an entire tour of 4 different Walgreens during that same 15-minute stroll.

2) In comparison to Walgreens’ 53 SF locations, its closest competitor, CVS, only has 22 stores. CVS has not announced any closures, despite surely suffering from the same shoplifting epidemic as Walgreens.

3) In 2017, Walgreens told their shareholders they planned to close 600 stores by 2019. They closed 769.

4) In 2019, they informed the SEC they would be closing 200 more stores by 2022.

5) At the end of 2020, Walgreens had to settle with their own employees for $4.5 million due to wage theft and other violations.

6) In February of this year, Walgreens hired a new CEO at $1.5 million per year salary with a $25 million signing bonus, an annual bonus of up to 200% her earnings, an additional $11 million in stock options each year, relocation costs, benefits, and use of the corporate jet for up to 50 hours each year.

7) Around that same time Walgreens “reported a $308 million loss in its 2021 fiscal first quarter. The loss was primarily tied to its pharmaceutical wholesale business.” The company had seen “a dramatic drop in store traffic and pharmacy volume during the COVID-19 pandemic, with stay-at-home orders adversely affecting retail sales at its 9,000 locations in the U.S., and thousands more worldwide.”

8) Last month, the former chief financial officer of Walgreens testified in the trial against Elizabeth Holmes, the alleged con artist at the helm of Theranos, the tech company promising impossible blood testing abilities. He testified that in 2014, Walgreens sunk $140 million into the scam. They sued to get it back but ended up settling for less than $30 million — a net loss of $110 million.

So! Five stores closing in San Francisco, that just so happens to fit in with the rightwing narrative that it’s all because of “thugs” stealing deodorant, which fills the time on Fox News to rile up their viewers to get angry about the lawless liberal enclave of San Francisco, and it gets Walgreens great sympathy as they proceed to lose millions of dollars on scams and lawsuits while closing 900 stores around the country without a peep of complaint from anyone.

And that, friends, is why I will never, ever care about shoplifting. Is it morally wrong? Sure. Usually. Maybe. I mean, it depends. But is it a big deal? Absolutely not. It’s fine. Whatever. I’ll direct my anger elsewhere, thanks.